Bitcoin: Neither Security Nor Commodity - Gensler's Indecision

During a congressional hearing, SEC Chairman Gary Gensler reaffirmed that Bitcoin is not a security. However, he refrained from categorizing it as a commodity, leaving doubts about the exact classification of this flagship cryptocurrency.

SEC Chairman Criticized by Congress

Is Bitcoin the SEC chairman’s black sheep? The situation is becoming increasingly complicated for Gensler as the crypto industry continues to suffer repression from the regulator. Indeed, the US Congress has strongly criticized him for his unclear positions on the status of Bitcoin.

JUST IN: 🇺🇸 SEC Chair Gary Gensler says #Bitcoin is not a security, but refuses to say it's a commodity. pic.twitter.com/JQaTK8xPEl

— Watcher.Guru (@WatcherGuru) September 27, 2023

Do you believe that Bitcoin is not a security? That was the question posed by Congressman Patrick McHenry, which Gensler confronted. The SEC chairman then asserted that Bitcoin is not a security. He referred to the “Howey Test”, a set of criteria that determine whether an asset is a security. According to him, Bitcoin did not meet these criteria.

On the other hand, he could not clearly confirm whether the flagship crypto was a commodity. Indeed, the MP asked whether Bitcoin, which is therefore not a security, should be considered a commodity. But Gensler was unable to confirm this.

The SEC chief’s hesitations in front of Congress cast doubt on the classification of the biggest crypto on the market.

Bitcoin in a regulatory limbo

The uncertainty surrounding the regulation of Bitcoin (BTC) has repercussions on its price and investor confidence.

While some hope that clear regulations could confer greater legitimacy on the crypto, others fear that excessively stringent regulations could hinder its adoption and growth potential. Thus, Bitcoin’s status remains in a period of uncertainty, awaiting more precise guidelines from US regulators.

In terms of value, the Bitcoin price yesterday showed some volatility. It briefly reached the $28,800 mark. Until the regulatory situation is clarified, the flagship crypto is likely to experience further consolidation.

Bitcoin spot ETFs could well be the next catalyst on the crypto market.